Nation & World

Posted: Monday, May 23, 2005

The U.S. economy, as measured by gross domestic product, is projected to expand by 3.4 percent in 2005, compared with an earlier estimate of 3.6 percent, according to the latest outlook from the National Association for Business Economics. The lower forecast mostly reflects economists' beliefs that the trade picture will worsen. The U.S. trade deficit hit a record $617 billion last year. If correct, the projections would mark a slowing in growth from the 4.4 percent increase in GDP in 2004.

A federal judge told dozens of lawyers Monday that there could ultimately be up to 100,000 cases filed against Merck & Co. (NYSE: MRK) over its now withdrawn pain reliever Vioxx, and that he could hear a case as early as the fall.

There have been over 2,000 cases filed against the drug maker so far. Analysts have estimated that Merck's potential liability could reach $18 billion. Merck withdrew Vioxx from the market last September.

Wall Street was buoyed by a report that Apple Computer Inc. (NasdaqNM: APPL) was in talks to use Intel Corp. chips in its computers. An Apple move to Intel's (NasdaqNM: INTC) chips would make Macs less expensive - a major hurdle in Apple's ongoing battle with cheaper PCs already using Intel processors and Microsoft's operating system. The possible deal, reported in The Wall Street Journal, could spell trouble for International Business Machines Corp., Apple's current supplier.

The European Union has given Microsoft Corp. (NasdaqNM: MSFT) until the end of the month to comply with its antitrust order or face punitive sanctions.

The dispute stems from what regulators consider the software maker's recalcitrance in providing server software source code to competitors, and on EU doubts on whether the Windows without Media Player version that Microsoft was forced to produce is technically up to standard.